SC quashes UOI’s review petition against order refusing to transfer Dish TV licence fee case from J&K HC

MUMBAI: The Supreme Court has dismissed union government’s review petition against its order passed in September 2019 involving direct to home (DTH) operator Dish TV.

In September 2019, the apex court had dismissed the union government’s petition to transfer Dish TV’s licence fee case from Jammu & Kashmir High Court to itself. The UOI filed a review petition against the SC order.

Incidentally, the SC allowed UOI’s petition to transfer all the direct to home (DTH) licence fee cases from the Kerala High Court to itself. Three DTH licence fee cases involving DTH operators Sun Direct, Videocon d2h, and Bharti Telemedia were pending in the Kerala High Court. Videocon d2h has since merged with Dish TV.

While the other licence fee cases pending in Kerala High Court were transferred to the SC the Dish TV case in J&K High Court was not transferred.

On 21st January, the SC passed an order stating, “Having perused the Review Petition and the connected papers with meticulous care, we do not find any justifiable reason to entertain this review petition. The Review Petition is, accordingly, dismissed. Pending application(s), if any, shall stand disposed of.”

In September 2019, the apex court while hearing UOI’s petition stated that it is “not inclined to entertain this petition filed under Article 32 of the Constitution of India. The writ petition is, accordingly, dismissed. Pending application(s), if any, shall stand disposed of”.

In November 2015, Dish TV and Sun Direct had secured interim relief from the Jammu & Kashmir and Kerala High Courts respectively on the licence fee issue.

In the case of Dish TV, the J&K High Court had passed an order stating that the petitioner (Dish TV) will continue to make payments of licence fee on the basis of the judgement passed by Telecom Disputes Settlement and Appellate Tribunal (TDSAT) on 28 May 2010.

The Kerala High Court had also accepted Sun Direct’s plea for directing the government to accept licence fee payment only on licensed activities till the disposal of the petition. The HC had also directed the government not to take coercive action against the DTH operator till the disposal of the matter.

The tribunal had passed an order on 28 May 2010 allowing Sun Direct and Bharati Telemedia’s (Airtel Digital TV) petitions entitling them to the benefit of the judgments passed by it on 7 July 2006, 30 August 2006 and 26 August 2008 as also the recommendations of the Telecom Regulatory Authority of India (TRAI) dated 1 October 2004.

The sum and substance of these orders are that the license fees for DTH operators should be applied on the basis of adjusted gross revenue which means total revenues excluding items that are of a pass-through nature.

In its judgement dated 7 July 2006, the tribunal had stated that the AGR in case of DTH service will exclude i) subscription fee charges passed on to the pay channel broadcasters; ii) sale of hardware including integrated receiver decoder required for connectivity at the consumer premise; and iii) service/entertainment tax actually paid to the central/state government if gross revenue had included them.

The DTH operators are currently required to pay 10% of their gross revenue (GR) as licence fee. The TRAI has, however, recommended to the ministry of information and broadcasting (MIB) that the licence fee should be levied at 8% of Adjusted Gross Revenue (AGR) where AGR is calculated by excluding, Service Tax, Entertainment Tax and Sales Tax/VAT actually paid to the Government, from the Gross Revenue (GR).

Pertinently, the DTH operators have also challenged the MIB’s 24th March 2014 notice asking them to fork out Rs 20.66 billion in licence fee dues. The TDSAT had given interim relief to the DTH operators. The matter is still pending before the TDSAT.

The MIB had directed Dish TV to pay Rs 625 crore followed by Tata Sky (Rs 620 crore), Airtel Digital TV (Rs 298 crore), Sun Direct (Rs 230 crore), Videocon d2h (Rs 157 crore), and Reliance Digital TV (Rs 136 crore).

In 2014, Tata Sky had paid Rs 383 crore to the government as licence fee for the previous fiscal and arrears. In FY18, the DTH operator had paid Rs 2200 crore as taxes & levies including licence fee to the government. This included the licence fee of Rs. 561 crore at 10% of gross revenue.

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